Thai Central Bank Cut Interest Rates, Baht Weaker

The Thai baht fell today after the nation’s central bank reduced its key interest rate in an attempt to spur economic growth that has slowed last year because of the biggest floods in almost 70 years.

The Bank of Thailand reduced its main interest rate by 0.25 percent to 3.00 percent today. Last year’s floods resulted in closing of more than 16,000 factories, hurting economic growth. Thailand’s economy expanded 1.5 percent in 2011, while before the floods growth was estimated to be 4.5 percent. Prime Minister Yingluck Shinawatra promised to spend 350 billion baht ($11.1 billion) on infrastructure to prevent a new disaster.

USD/THB rose from 31.4250 to 31.6050 as of 12:22 GMT today, touching the daily maximum of earlier.

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